January 24, 2009

Barack Obama is many things to many people. Among the groups claiming a special resonance with him are mothers like me. Who has not seen The Photo (can it be that there is only one?) of toddler Barack and his young mother? His memoir may be titled "Dreams From My Father," but in the preface, Obama says that his mother "was the single constant in my life" and that "what is best in me I owe to her." She brought him up largely on her own.

This is significant for me as an unmarried mother of a preteen son, and it surely resonates for other mothers raising their children without dads. Growing up without a father, my son has at times struggled to feel "normal." ...

For my son, the issue is fatherlessness. Not having a father has been an impediment to "fitting in." He yearns for an adult man to call his very own and is uncomfortable when other children talk about their fathers or ask about his. This discomfort has affected his sense of security about his future, about measuring up and "making it" (whatever that means). ...

It is hard to watch him do this, even though thousands upon thousands of households today are headed by women who don't have partners. I know, however, that it takes time for the world around us to catch up to where society already is. For example, my son's tae kwon do teacher had the habit of talking to the students about their "moms and dads." I took him aside one day and suggested that the term "parents" might do the trick, with no child left behind. But there is a limit to how much a mother can protect her son from the word "dad." A mother can repeat to her child that there is no model "normal" family, but the world reflected and projected by television tells another story. My son and others like him are a silent and almost invisible minority, but they know who they are.

For these young people, the election to the presidency of a man who grew up without a dad signifies a seismic shift. The mere candidacy of Barack Obama has spoken eloquent volumes to my son where my words had failed. I know this because my son now walks a bolder walk and talks a more confident talk. The doors of his imagination have swung open, and his sense of his place in the world has changed. He is proud to share this identity with the new president. For my son, Obama's inauguration this week felt like a personal embrace. For him and for the growing number of children being raised by their mothers alone, all of the ceremony showed something, in a concrete way, that our words alone cannot: Yes, you can.

I frequently criticize the mainstream media for not writing about things that are boring and depressing. And yet, I found Israel's pummeling of the Gaza Strip to be boring and depressing, so I've barely mentioned it, other than suggesting some technical defensive solutions that Israel could try to counter the not-terribly-frightening threat of Gaza-launched flying pipebombs that turned out to be, according to better-informed commenters, not terribly feasible.

In contrast, I wrote much about Israel's fight with Hezbollah in 2006 because then there was a media mania for demanding that America take up the 51st State's burden and go start a war with Iran to help out Israel.

We Americans appear to have made a lot of progress since 2006 in grasping that Israel is actually a foreign country, and that Israel has its own national interests which are by no means identical with our national interests. Of course, that hardly implies that the U.S. should be active on the side of Israel's enemies, either.

I recognize that Israel faces a difficult strategic situation, and I'm not that motivated to either condemn or commend what it does, so long as it doesn't drag the U.S. along with it. Now that there is some indication that Israeli influence over the U.S. is beginning to slip (thanks due to the ugliness of the Gaza attack, the embarrassment of Bernie Madoff, but no thanks to Obama's appointments -- Obama's thinking on the Israeli Lobby's power, like his thinking on much else is so 2007), I'm not in the mood to kick Israel when it's down.

Realistically, U.S. policy will remain tilted in favor of Israel due to the power of the domestic Jewish lobby, just as U.S. policy has been tilted against Cuba due to the power of the domestic Cuban exile lobby. The important thing, more critical than our foreign policy, is that we here in America be free to publicly discuss why our foreign policy is biased toward Israel. That has been true regarding our bias against Cuba, but not, at least until very recently, regarding Israel.

Last summer, I outlined in VDARE.com a realist approach to thinking about America's relationship with Israel in "The Cuban Compromise: A Sustainable Model for the Jewish Lobby," which suggested that Americans should agree to Israel's fundamental interests in the same manner as America has treated the Cuban exile lobby's interests -- allowing Israel to push around the Palestinians, and a guarantee of refugee status for Israelis in the U.S. if the worst should somehow happen to Israel; on the other hand, America would not fight Israel's wars for it and, most importantly, Americans would be free to describe and criticize the power of the Jewish lobby.

No American did more to resuscitate Evelyn Waugh's reputation than the late William F. Buckley. By Waugh's death in Mod 1966, the reactionary Catholic novelist's standing had fallen almost as low as Jay McInerney's is today, yet Buckley's devotion introduced Waugh to a new generation. In Waugh's 1982 apotheosis, the monumental 13-episode Brideshead Revisited miniseries, Buckley was rightly hired to host the show on PBS.

Hence, the news that the new movie adaptation of Brideshead, Waugh's magenta-hued 1945 saga about a decadent Catholic noble family, would star the English actor Matthew Goode was intriguing. Goode (who played an amusing aristocrat in Woody Allen's "Match Point") resembles a young Buckley, especially in his express elevator eyebrows. His patrician magnetism made him a natural to play Sebastian Flyte, the charming toff who beguiles Charles Ryder, an ambitious bourgeois aesthete, when they meet at Oxford in 1923.

After Sebastian drinks himself into a monastery, Ryder's "romantic friendship" with Sebastian is followed by a mature love affair with Sebastian's sister Julia. She's unhappily married to the crass politician Rex Mottram (whom Waugh modeled on Winston Churchill's right hand man, Brendan Bracken). Rex is willing to give her a divorce, but Julia's vestigial Catholicism raises qualms in her about remarriage.

Unfortunately, the new "Brideshead Revisited" film casts Goode as the narrator, Charles Ryder, the reticent interloper dazed by the refinement of the Flyte family and their stately home Brideshead (played once again by the stupendous Castle Howard in North Yorkshire), leaving Goode few occasions to deploy his Buckleyesque facial gymnastics.

Despite that missed opportunity, the new "Brideshead Revisited" is a perfectly competent film for grown-ups, superior to last year's similar exercise in English upper crust period porn, the Best Picture nominee "Atonement."

"Atonement" invited us to indulge in the modern metasnobbery, to publicly tut-tut about the horrors of the English class system while privately wallowing in the visual splendor it created. In contrast, Waugh was an old-fashioned snob, whose only objection to class was that he should have been born into the very highest one.

While the 2008 "Brideshead Revisited" is certainly tasteful and efficient, those are just about the last words you'd associate with Waugh's grand but sprawling bestseller, half-masterpiece, half-embarrassment. Waugh had achieved near-perfection in Scoop, his 1938 satirical novel. In the more melodramatic Brideshead, however, he wore his heart on his sleeve ("The languor of Youth -- how unique and quintessential it is! How quickly, how irrecoverably, lost!"), revealing the easily bruised soul over which he had grown his carapace of malicious wit.

The new "Brideshead" is thus a good film, but not good Waugh. That's hardly surprising -- despite the enormous sums Hollywood invests in major novels by major novelists (in 1946, MGM paid Waugh $140,000 for Brideshead, but never made the film), they inevitably fail to translate fully to the screen. There's simply too much there.

It's unfortunate for the movies that the short story has almost died as an art form. As John Huston's 1975 adaptation of Kipling's short story The Man Who Would Be King demonstrated, it's often more satisfying for all concerned to expand a 20 page tale than to eviscerate a 350 page novel.

In contrast, the old miniseries certainly did Waugh justice by running an outlandish 659 minutes. In truth, that's too long; I endured the first two hours, then gave up due to the glacial pacing. As superb as the acting was, the miniseries was a relic from the Shogun era, before the universality of remote controls sapped audiences' patience. (Perhaps the producers of the new film should have simply edited the eleven-hour classic version down to 135 minutes.)

The modest attempts to modernize this 2008 Brideshead just sap the delirious momentum of the book. For example, the screenwriters concoct a scene in which Rex sells Julia to Charles in return for two paintings, as if she's his possession, causing Julia to flare up with feminist resentment. In the book, though, Julia despises Rex not because he's an antiquated patriarch, but because he's a blasé modern husband untroubled by her infidelity.

Co-screenwriter Andrew Davies, age 71, has implied that he felt ill at ease over Brideshead's Catholicism, with all that outdated distaste for divorce: why shouldn't Julia marry Charles once they've both shed their spouses? Yet, attitudes have changed once again, necessitating that the new film delete Charles's two children by his first wife to keep the adulterer a sympathetic character for today's younger audiences.

January 23, 2009

Clearly, Obama is more than a little stumped by the economic problems facing the country. His assumption during the campaign was that the big problem was that America was too damn rich: all that getting and spending was causing inequality and global warming. So, he figured he'd gin up an alternative energy bubble to help his kind of folks get rich quick while the economy as a whole transitioned to higher taxes. Sure, some people would suffer, but it would all be in a good cause.

Now, however, it apparently has dawned on Obama that America isn't anywhere near as rich as his economic advisers were telling him. Here's Jeremy Grantham, via Clusterstock, on just how big the shortfall in wealth is.

The fundamental problem is that Americans aren't productive enough.

Uh-oh. Obama was looking forward to the Presidency as the culmination of a career single-mindedly devoted to spending other people's money. What does he know about making money? To Obama, creating wealth was always an occupation for cruder souls. Let Old Man Annenberg get rich on TV Guide, so long as he would give tens of millions to finer spirits like Obama and Ayres to dole out to their allies.

So, Obama has been thrashing around, announcing giant plans to screw in lightbulbs here and fill in potholes there. And, there will be lots more regulation. It's all been depressing and dopey, but who has any better ideas?

So, let's come up with some better ideas. Please post them in the comments.

Personally, I'm not very interested in macroeconomics. In my experience, macroeconomic fixes work until they stop working. I'm not trying to be glib. A lot of macroeconomics is based on fooling the public, which works great as long as the public stays fooled. For example, when I was a kid in the 1960s, the Philip's Curve was all the rage among the reigning Keynesian economists. It said that you could cut unemployment by raising the inflation rate, because that would fool job-seekers into thinking that they were getting offered more than they would actually get.

A foolproof plan! What could possibly go wrong?

Well, by the 1970s, everybody had figured it out, so the Philip's Curve was junked. But, now, macroeconomic gimcrackery like that is back in fashion.

To my mind, however, the most plausible way to make American enterprise more productive is to cut back on the government-mandated luxuries that seemed affordable during the fat years but now aren't worth the cost.

California -- already in danger of running out of money -- reported that its December unemployment rate hit 9.3 percent, up from 8.4 percent in November and waaay up from 5.9 percent in December 2007.

The state shed 78,200 jobs in December, excluding farm workers as the economy is getting hammered by the recession. If California were an independent nation, its Gross Domestic Product would place it among the world's top 10 countries.

California has one of the nation's highest foreclosure rates. It is now tied with Louisiana for the nation's lowest credit-rating. Moody's has warned it may cut the state's debt rating, making much-needed loans harder to get and more expensive.

At the same time, Gov. Arnold Schwarzenegger (R) has been chiding his legislature to plug the state's massive budget shortfalls, projected to be $15 billion this year and $25 billion next year.

This whole bet-the-country-on-diversity experiment is being prototyped in California, which is about four decades ahead of the rest of the country demographically. How's it working out?

By the way, keep in mind that it's been 15 years since a very destructive earthquake in California. (By my count, the big destructive ones were in 1906, 1932, 1971, 1989, and 1994.) So, it's not as if California is overdue ... yet. But there will be another Big One. And there are a lot more buildings in California to fall down than in the past, although they are more sturdily built now than in the past. (My house is, I hope, at the other extreme -- so flimsily built that the main danger in an earthquake is getting conked by a falling 2"x4".)

The point is that eventually there will be a trillion dollar earthquake in California that the whole country will have to pay for. Maybe if Obama's lucky, it will happen soon so he can double his stimulus plan!

And, by another way, that's one more reason construction in California is slower and more expensive than in Texas: more earthquake safety regulations and costs.

Now that the Dark Ages of American Science (January 20, 2001-January 19, 2009) are over and we are all basking in the bright light of reason, the New York Times reports that miracles are occurring due to beneficent psychic emanations from Obama's puissant aura:

Educators and policy makers, including Secretary of Education Arne Duncan, have said in recent days that they hope President Obama’s example as a model student could inspire millions of American students, especially blacks, to higher academic performance.

Now researchers have documented what they call an Obama effect, showing that a performance gap between African-Americans and whites on a 20-question test administered before Mr. Obama’s nomination all but disappeared when the exam was administered after his acceptance speech and again after the presidential election.

The inspiring role model that Mr. Obama projected helped blacks overcome anxieties about racial stereotypes that had been shown, in earlier research, to lower the test-taking proficiency of African-Americans, the researchers conclude in a report summarizing their results.

“Obama is obviously inspirational, but we wondered whether he would contribute to an improvement in something as important as black test-taking,” said Ray Friedman, a management professor at Vanderbilt University, one of the study’s three authors. “We were skeptical that we would find any effect, but our results surprised us.”

The study has not yet undergone peer review, and two academics who read it on Thursday said they would be interested to see if other researchers would be able to replicate its results.

Dr. Friedman and his fellow researchers, David M. Marx, a professor of social psychology at San Diego State University, and Sei Jin Ko, a visiting professor in management and organizations at Northwestern, have submitted their study for review to The Journal of Experimental Social Psychology, Dr. Friedman said.

“It’s a very small sample, but certainly a provocative study,” said Ronald F. Ferguson, a Harvard professor who studies the factors that have affected the achievement gap between white and nonwhite students, which shows up on nearly every standardized test. “There is a certainly a theoretical foundation and some empirical support for the proposition that Obama’s election could increase the sense of competence among African-Americans, and it could reduce the anxiety associated with taking difficult test questions.”

Researchers in the last decade assembled university students with identical SAT scores and administered tests to them, discovering that blacks performed significantly poorer when asked at the start to fill out a form identifying themselves by race. The researchers attributed those results to anxiety that caused them to tighten up during exams in which they risked confirming a racial stereotype.

In the study made public on Thursday, Dr. Friedman and his colleagues compiled a brief test, drawing 20 questions from the verbal sections of the Graduate Record Exam, and administering it four times to about 120 white and black test-takers during last year’s presidential campaign.

In total, 472 Americans — 84 blacks and 388 whites — took the exam. Both white and black test-takers ranged in age from 18 to 63, and their educational attainment ranged from high school dropout to Ph.D.

On the initial test last summer, whites on average correctly answered about 12 of 20 questions, compared with about 8.5 correct answers for blacks, Dr. Friedman said. But on the tests administered immediately after Mr. Obama’s nomination acceptance speech, and just after his election victory, black performance improved, rendering the white-black gap “statistically nonsignificant,” he said.

“It’s a nice piece of work,” said G. Gage Kingsbury, a testing expert who is a director at the Northwest Evaluation Association, who read the study on Thursday.

But Dr. Kingsbury wondered whether the Obama effect would extend beyond the election, or prove transitory. “I’d want to see another study replicating their results before I get too excited about it,” he said.

No, this isn't from The Onion.

Funny how Obama personally presiding over the giving away of $100,000,000 or so to improve Chicago school performance as chairman of the Annenberg Chicago Challenge didn't do a damn thing for the test scores of Chicago black students, but his ascent to supreme power, his wonders doth work.

I analyzed the ever-popular urban legend of Stereotype Threat in a 2004 VDARE.com piece called "Occam's Butterknife." Bottom line: it's really easy for "researchers" to depress black students' scores on tests of no importance to the students by giving them hints that they don't want them to work hard on the test.

Recently, I wasted about an hour late one night on detours and traffic jams because a three-mile stretch of Interstate 5 is shut down for widening every night from 11pm to 4am. It illustrates a lot of the unpleasant tradeoffs on the horizon in Obama's Daleyesque ideas for "infrastructure stimulus" spending.

This is the main West Coast highway from San Diego to Seattle, so it's a crucial artery for trucks, but the long stretch just south of downtown LA, the old Golden State Freeway, is only three lanes each way. For some number of years now, CALTRANS has been adding a fourth lane each way for a stretch at the southern end of the bottleneck in northern Orange County. I have no idea if this will do much good for northbound drivers heading to downtown LA since they still must squeeze down to 3 lanes eventually. For southbound drivers, it will mean traffic speeds up three miles earlier as they go from 3 to 4 lanes.

Notice, however, that because I-5 is such an important part of the nation's infrastructure, it is only being shut down 5 hours per day: 11pm to 4am. That's barely half a shift -- not much of a job creator and not much of a quick stimulus either. Or Obama could pay to run two shifts a day, creating lots more construction jobs ... and completely snarl Southern California traffic.

I suspect a lot of similar tradeoffs will emerge in transportation stimulus spending.

One thing that was readily apparent that night was that there's a fairly low maximum tolerable density for simultaneous infrastructure projects, which limits how fast you can spend money on infrastructure stimulus. Shutting I-5 was tolerable to me because I-91, which I used for a long detour because it crosses I-5 at a 45 degree angle, wasn't also shut for upgrading. If they'd both been closed for work, I'd still be out there.

That means that the optimal pace of spending on infrastructure is slow. SoCal freeways, for instance, can aborb a lot of taxpayer money, but they can't absorb them all that fast without making traffic much worse than it is now.

The NYT article "Two Sides of a Border: One Violent, One Peaceful" compares the low murder rate in El Paso to the carnage in Ciudad Juarez across the Rio Grande (which, when I crossed the bridge that figures in "No Country for Old Men" in 1980, cost me $0.02 each way). The newspaper mentions various theories, but the article should have mentioned that El Paso has long been famous for an anomalously low crime rate.

By legend Texans are a grandiose breed with more than the natural share of megalomaniacs. But University of Texas Biochemist Earl B. Dawson thinks that he detects an uncommon pocket of psychological adjustment around El Paso. The reason, says Dawson, lies in the deep wells from which the city draws its water supply.

According to Dawson's studies of urine samples from 3,000 Texans, El Paso's water is heavily laced with lithium, a tranquilizing chemical widely used in the treatment of manic depression and other psychiatric disorders. He notes that Dallas, which has low lithium levels because it draws its water from surface supplies, has "about seven times more admissions to state mental hospitals than El Paso." But state mental health officials point out that the mental hospital closest to Dallas is 35 miles from the city, while the one nearest El Paso is 350 miles away—and the long distance could affect admission figures.

But FBI statistics show that while Dallas had 5,970 known crimes per 100,000 population last year, El Paso had 2,889 per 100,000. Dallas (pop. 844,000) had 242 murders, El Paso (pop. 323,000) only 13. Dr. Frederick Goodwin, an expert on lithium studies for the National Institute of Mental Health, doubts that "lithium has these magical properties in the population." Others are not so sure. If lithium does have anything to do with the relative peace in El Paso, what would it do for other cities like New York and Chicago?

I have no idea if Dawson's lithium theory panned out, but it's fun to recall something I heard about three decades ago when I went to Rice U. in Houston.

By the way, I give reporter James C. McKinley a thumbs-up for using the dreaded V word correctly for once in describing a Mexican neighborhood:

Across the river, the once-vibrant streets of Juárez are dark and gloomy, as residents scurry for home.

My recollection of my evening in Ciudad Juarez in 1980 was that the tourist section was, indeed, "vibrant" -- which, I insist, should only be used to denote a neighborhood with lots of loud live music coming out of the doors of bars (e.g., you can rightly call the French Quarter in New Orleans vibrant, but calling Van Nuys, CA "vibrant" just shows you can't think of anything else to say about it).

January 22, 2009

Here's my American Conservative review of "Australia," which only got one Oscar nomination -- Best Costumes for director Baz Luhrman's wife. (So, Baz gets shut out, but at least people get reminded that he has a wife.)

The pre-fab national epic “Australia,” a sprawling romance set in the desolate Northern Territory during WWII, represents a risky change in subject and style for Baz Luhrmann, one of this era’s most distinctive directors.

Luhrmann might not be the most naturally talented auteur, but he’s one of the bravest, willing to carve out, through trial and error, his own cinematic language, then throw it away and try to find another one.

Luhrmann’s first three films comprised his Red Curtain Trilogy. He started in 1992 with the dance contest movie “Strictly Ballroom,” and followed with “Romeo + Juliet” in which Leonardo DiCaprio declaims in iambic pentameter in Verona Beach, Florida. Finally, he drove the film fanboys insane with rage but won the hearts of young women with the lushly wretched excess of his astonishing 2001 musical “Moulin Rouge,” in which Ewan McGregor and Nicole Kidman, as the doomed lovers in 1899 Montmartre, not only break into song, but into songs that won’t be written for decades.

Luhrmann worked out a novel set of conventions for his Red Curtain style, the maximalist opposite of Lars Von Trier's more celebrated but less successful Dogme 95 minimalism. Like Bollywood musicals intended to be understood by peasant audiences, the Red Curtain rules stressed blatantly unrealistic theatrical artifice; plots that are time-tested, if not downright hackneyed (in “Moulin Rouge,” we quickly infer from La Traviata and La Bohème that the beautiful courtesan must ultimately die of consumption in the young poet’s arms); and shameless melodrama, all as “a device to disarm oh-so-clever, oh-so-cool people, so that you can have these very direct emotional experiences,” as Luhrmann explained in 2001.

Perhaps tired of everyone assuming that he must be gay because he made musicals (Luhrmann and his wife, Oscar-winning costume designer Catherine Martin, have two small children), Luhrmann decided to make the Great Australian Movie.

In “Australia,” Luhrmann and company work awfully hard to entertain us. The extraordinary lighting ought to ensure that his director of photography, Mandy Walker, becomes the first woman ever Oscar-nominated for Best Cinematography.

No Oscar nomination for her, so women remain shut out of Cinematography nominations completely in the history of the Academy Award going back to the 1920s. The biggest reason for this 0 for roughly 400 performance is that to become a cinematographer, you have to work your way up the ladder via upper body strength by lugging heavy lights and cameras around the set. (Actually, now that I think about, aspiring directors of photography work their way down the ladder -- it's the apprentices who have to go aloft to rig heavy lights.) So, the bottom ranks are almost exclusively men (and probably fairly strong men, I would assume). Yes, no doubt there are cognitive differences in visuospatial orientation between the sexes, but not big enough to account for 0 for ever.

By the way, if the Academy wants to give out more Oscars to women in technical categories -- which they always say they do -- they should start giving out a Best Casting director Oscar. The great majority of casting directors are women. (A big part of having a long career as a casting director is rejecting actors with fragile psyches gently enough that they'll keep coming back to audition for your next project). Granted, casting directors aren't as big a deal in movies as in TV shows (where Bonnie Timmerman became famous a quarter of a century ago for her casting of guest criminals and witnesses on Miami Vice), but the casting of minor roles would seem to be about as important a part of movie-making as, say, Sound Editing, which has its own Oscar.

Still, the mixed results of “Australia” suggest that it’s better to start a national epic with a good story (Scarlett and Rhett, say) than with enormous ambition but no plot. Luhrmann and his three co-writers ginned up a scenario in which Kidman plays a starchy English aristocrat who has inherited 7.5 million acres of Outback. Hugh Jackman (Wolverine of “X-Men”) is the ruggedly affable cowboy who must drive her 1500 head of cattle to Darwin’s dock. When watching “Moulin Rouge,” you always knew how it would end, but never knew what would happen next. With “Australia,” a prolonged pastiche of famous epics, you can always guess what comes next, but never know when it will end.

This framework does allow Luhrmann to drag in edifying events from Australia’s rather undramatic history books, such as the Pearl Harbor Lite bombing of Darwin by the Japanese in 1942, and the oft-lamented “Stolen Generations” of half-Aboriginal children who were taken away from their alcoholic mothers and given free educations. Luhrmann ladles on plenty of the kitschy Aboriginal spirituality that the Australian tourist board employs to distract from the appalling condition of Aborigines under today’s multiculturalist welfare state.

Still, despite his populist sympathies, Luhrmann remains an idiosyncratic experimentalist better suited to eight-figure rather than nine-figure budgets. In “Moulin Rouge,” he found a stylistic rule that organized his film. As the story turned from comedy to tragedy, the pace of the editing slowed from frenetic to monumental. In “Australia,” though, he doesn’t seem to have yet stumbled upon a mode to suit his new genre. I hope studios keep giving him $130 million per epic until he does, although I fear they won’t.

Jackman and Kidman are fine, but they’re fairly generic movie stars. It’s hard not to wonder what Australia’s A-Team (Russell Crowe and Cate Blanchett) might have done. Of course, without better lines than “Australia” musters, Clark Gable and Vivien Leigh themselves would not have generated much movie magic.

The film, though, is saved by the performance of newcomer Brandon Walters as the little half-Aboriginal boy who narrates. The camera loves his big eyes and dark gold hair, and he has an ingenuous way with Pidgin English (“We gonna drive ev'ryonna those fat cheeky bulls allaway to da big metal boat!”) that left me calling, for perhaps the first time ever, for “Less dialogue, more voice-over!”

Rated PG-13 for some violence, a scene of sensuality, and brief strong language.

Here's an impressive data-crunching article by Zach Fox of the North County Times, a local newspaper in the relatively affluent northern reaches of San Diego County. As I've been saying, one reason the enormous fraud during the Housing Bubble flew under the national media's radar was because a sizable fraction of the bogus business was being transacted in Spanish, among Spanish-speaking buyers, real estate agents, and mortgage brokers.

Think about if we had had a simple regulation mandating a minimum 5% down payment per home purchase. For example, this article cites the two year-long career of San Diego real estate agent Elias Chavez: 19 homes sold, all to Latinos, 14 of them already foreclosed. The mean price of the houses he sold was $473,000, so the mandatory downpayment would have been $23,684. That would have separated the sheep from the goats right away. But George W. Bush campaigned against down payments, calling them a barrier to people like Chavez's clients getting their fair share of the American Dream.

A tiny number of real estate brokers is associated with an inordinately large number of foreclosures in North County, raising questions about how just a few salesmen could play a role in sending hundreds of families into foreclosure and causing millions of dollars in losses for lenders. ...

A North County Times investigation into thousands of foreclosure records, along with interviews with buyers, reveals a pattern that suggests some real estate agents specialized in clients ---- chiefly Latinos ---- who couldn't afford to buy homes, and helped them buy as many as possible.

Basically, Fox has picked out 21 out of about 1000 active real estate brokers whose foreclosure rates on properties sold since 2003 are at least three standard deviations above the mean for the worst neighborhood in North County

A typical real estate office, usually a broker and a group of affiliated agents, has seen from 2 to 4 percent of their buyers' homes go back to the lender.

But the NCT analysis found that 21 brokers have accumulated foreclosure rates of 25 to 60 percent, a figure that could go much higher because many buyers are late on mortgage payments but are not yet in foreclosure.

All of the agents in these offices had similar sales records: They appear to have specialized in finding Latino buyers, and most of the attached mortgages were from "subprime" lenders that specialized in lending to borrowers with weak credit scores.

Together, the offices represent about 2 percent of the sales activity in North County since Jan. 1, 2006.

Yet, since 2007, when the region's foreclosures began to surge, they accounted for 455 foreclosures ---- 11 percent of all foreclosures analyzed in the investigation. ...

And the analysis does not show that Latino borrowers have caused more foreclosures than other ethnic groups.

But, it doesn't show they didn't, either -- this analysis is focused on brokers, not buyers.

Rather, it shows that the few real estate agents with unusually high foreclosure rates represented primarily Latino buyers.

Analysts such as Sandos say that relatively low foreclosure rates are prevalent among Latinos and first-time, entry-level borrowers who participated in government-backed mortgage programs.

In its investigation, the NCT combed through more than 5,800 foreclosure listings in North County provided by ForeclosureRadar, a Northern California data firm, which were then cross-referenced with mortgage data from the county's recorder office and real estate listings.

The analysis matched North County foreclosures with 973 real estate brokers who represented the buyers.

All but 21 offices had rates of foreclosures that were within the range of what a statistician would find likely [i.e., three standard deviations from the mean in the worst neighborhood -- a generous interpretation of "likely," but the point is to isolate brokers who were without a doubt abusive).

Those brokers amassed 1,313 sales in the three years. Through December, 455 of those properties were seized by banks.

That rate of failed loans is more than six times larger than the regional average, which these figures skewed higher.

Several brokers also carried mortgage brokerage licenses, meaning they could sell a house and originate the loan ---- a legal role under California law.

Ruling out effects of low income

To reduce the likelihood that foreclosure rates were inflated simply because the 21 brokers catered to low-income borrowers, the analysis compared their figures with homes sold only in North County's most foreclosure-prone neighborhood, Oceanside's "Back Gate" near Camp Pendleton.

With foreclosure rates between 25 and 60 percent, the 21 brokers strayed from even the Back Gate's above-average foreclosure rate, which is 15 percent, by three standard deviations, a statistical measure of probability.

Such large deviations from the average are almost impossible to achieve randomly, said Jim Lackritz, a statistics professor at San Diego State University.

Well, one out of 973 would likely be three standard deviations from the mean through sheer bad luck -- if he did all his business in that neighborhood by the USMC boot camp's back gate. (Of course, the shady agents raise the foreclosure rate mean and standard deviation for everybody, so these guys are really, really bad.)

And of those 21, three brokers shattered the standard of impossibility, veering off the average rate by 10 standard deviations.

Boo-Ya!

Ten standard deviations! That's above and beyond the call of duty.

"It's at that point where you have to use the Jim Carrey line from 'Dumb and Dumber': 'So you're saying there's a chance?' " Lackritz said. "Yeah, but not in your lifetime or mine."

Many of the agents working for the 21 brokers sold relatively few houses, with almost all going into foreclosure.

For example, one agent sold nine houses; seven were lost to foreclosure.

But two brokers and two agents sold on a larger scale, making their foreclosure records much more abnormal:

-- About 40 percent of all the sales closed at the Century 21 Eldorado office in San Marcos have been seized by banks in foreclosure.

Two brothers who headed the office, Alejandro and Emilio Lopez, were arrested and pleaded guilty to fraud a year ago. Both have been released on parole after serving five months, prison authorities said.

Romero and his agents have sold 126 houses, 60 of which have ended with foreclosures.

Romero declined to comment through a lawyer.

-- The largest foreclosure rate among agents with more than 40 sales belongs to Vista agent Eduardo Ramos at 60 percent, or 35 foreclosures out of 58 sales.

Three phone numbers listed for Ramos were disconnected.

-- Escondido agent Agustin Castro sold 43 houses over the last five years ---- 20 have been lost to foreclosure, a rate of six standard deviations off the average.

'Prequalified' customers

In a phone interview, Castro said he sold houses to consumers who entered his real estate office, and that he never had involvement with the loan origination process.

Typically, his customers would "already have a prequalification. They would bring it in, we show them the house and that's about it," Castro said. "I'm not going to ask the loan officer for his qualifications."

Eighteen of Castro's foreclosures had lender data available to the NCT.

All were sold to borrowers with Latino surnames.

Of those, half of the mortgages were issued by Meritage Mortgage or New Century Mortgage ---- two relatively small subprime lenders.

And 14 of the purchases were made with no money down. ...

Buy more, get rich

Borrowers and real estate agents who used to work with at least two of the 21 high-foreclosure-rate offices said the salesmen would target low-income Latinos, posting fliers advocating homeownership in certain apartment complexes.

Then, at seminars, the agents would propose that buying multiple homes was the key to becoming rich.

Another person who said she attended Romero's seminars was Irma Sanchez of Encinitas. She didn't buy his pitch, but kept in touch with friends who did, she said.

Soon, they were facing foreclosure.

Real estate agents and brokers who do not originate loans themselves are largely insulated from the question of loan repayment.

It is illegal to encourage homeowners to lie about their incomes. And it is the job of lenders to establish whether a buyer is likely to repay the mortgage.

Yet, the state Department of Real Estate's code of conduct says brokers are "fiduciaries of their clients," a relationship generally understood to mean that brokers must act in the best financial interests of their clients.

The obligation has been widely ignored for years, said Jim Klinge, a real estate agent in Carlsbad.

"It's mandated," he said, "but it's a fleeting thought."

No kidding.

Klinge has posted a relatively low foreclosure rate at 2 percent, or one foreclosure out of 53 sales. ...

Tracing the similarities

The sales records of Romero, the Lopez brothers, Ramos and Castro ---- the four salesmen with ultrahigh foreclosure rates ---- had several similarities:

-- Essentially all the borrowers, 99 percent, had Latino surnames.

-- The majority of mortgages issued on the sales, 93 percent, carried no down payment.

-- The list of lenders on those mortgages reads like a graveyard of failed institutions, many of them exclusively subprime lenders: Washington Mutual, Argent Mortgage, Accredited Home Lenders and Fieldstone Mortgage.

Some, though not all, of the real estate agents sold multiple houses to the same person, with all of the purchases going to foreclosure in some cases.

Still, it is unclear how much involvement the real estate agents had in the loan origination process, where any misrepresentation of income ---- and therein, any fraud ---- would occur.

The NCT was unable to perform a search of who originated each loan because such data is not publicly available, and even most real estate insiders don't have access to it.

Law enforcement officials say that in cases of mortgage or real estate fraud that involve pumped-up prices or inflated incomes, the most common perpetrators of the fraud tend to be the loan officer or the appraiser.

Neither is listed on the documents publicly filed at the county recorder's office for each real estate sale.

Inexperience in some cases

Real estate agent Rico Telles, an independent agent based in Carlsbad, sold nine houses, seven of which have gone through foreclosure.

Telles said he was brand-new to the business in 2006 after working as a car salesman.

Since the housing bust, he said he went back to selling cars until a medical condition forced him off the lot.

Now he tries to keep up with the bills with a smattering of acting jobs.

Each foreclosure had its own reasons, Telles said in a phone interview.

"I'd always ask them, 'Is this what you want? Can you afford this?' " he said. "And they all said, 'Oh, yes.' I never made anyone buy anything."

Another agent said his inexperience in real estate contributed to his high foreclosure rate.

Elias Chavez worked with the convicted Lopez brothers out of the Century 21 office in San Marcos.

Chavez, who was not charged, said the office would provide clients and handle the entire loan process.

He sold 19 homes in two years, 14 of which have either gone through foreclosure or "short sale," meaning the bank agreed to sell the property for less than the mortgage.

In total, Chavez sold $9 million in real estate.

Average price $474,000, which is fairly downscale for this plush part of the country during the Bubble.

After leaving the office following an FBI investigation, Chavez said he learned more about mortgage origination and estimates that his employers, the Lopez brothers, made $30,000 per sale on mortgage commissions.

Combined with their split of commissions, Chavez said he thinks the office might have taken in as much as $600,000 from his sales.

He said he earned about $55,000.

"I wouldn't say it was my fault for these people losing their homes," he said in a phone interview. "I just think it was unfortunate I didn't know any better."

Where's Robert Downey Jr.'s Best Actor nomination for "Iron Man?" Heath Ledger got a Best Supporting Actor nod for "The Dark Knight" -- but he wouldn't have if he hadn't died from drugs, because "The Dark Knight" was a blockbuster, and they rarely give major category Oscars nominations to hugely popular films.

Robert Downey Jr. is eminently capable of dying from drugs, but it seems kind of harsh to ask that of him.

Yet, "Iron Man" wouldn't have been nearly as big of a hit with anybody else in the lead. I'd guess that Downey added $100 million to the domestic box office. It's kind of like a sportswriter saying, "We shouldn't give the MVP award to Peyton Manning because he makes so much money already, so I'm voting for the criminally underappreciated long-snapper on the Detroit Lions. Look how much they had to punt this year!"

"Slumdog Millionaire" is second in Oscar nominations with 10 to "Benjamin Button's" 13. Here's an excerpt from my review in the current American Conservative:

After sweeping the Golden Globe awards, “Slumdog Millionaire,” the plucky movie about an uneducated underdog from the slums of Bombay who wins 20 million rupees on the local version of the quiz show Who Wants to Be a Millionaire, has become the Oscar race overdog.

Seven-year-old Jamal and his older brother Salim are orphaned in 1992 when Hindu nationalist mobs torch their Muslim slum in Bombay. (Or “Mumbai,” as the Shiv Sena politicians who fomented these pogroms renamed the city in 1996. Although trendy Westerners all use “Mumbai” now, no locals call their famous film industry “Mullywood.”)

... To make enough money to run off with his beloved, Jamal goes on “Who Wants to Be a Millionaire.” There, as fate, karma, or kismet would have it, he finds he knows the answer to each trivia question because it had already come up at a memorably dramatic moment in his life. ...

The film contains, in theory, most of the elements of a crowd pleaser, but the actual product turns out to be less enjoyable to watch than a good episode of Who Wants to Be a Millionaire. ...

Worse, the script is as on-the-nose as the dog comedy “Marley and Me.” Sadly, Boyle and screenwriter Simon Beaufoy didn’t trust their gimmick. Who Wants to Be a Millionaire has been a hit around the world because its slow pacing (the opposite of Jeopardy!) allows viewers to think along with the contestant as he talks out his thought processes. Thinking is fun.

“Crash” (an equally contrived but more interactive film) allowed viewers a half minute to rewind the plot in their heads and figure out for themselves the climactic conundrum of why nobody was killed when the angry Iranian shot the Mexican locksmith’s angelic daughter at point-blank range.

Sadly, “Slumdog Millionaire” doesn’t encourage any thinking back about earlier scenes. Instead, each quiz question is followed by a lengthy flashback ending with The Answer. For example, after “Who invented the revolver?” comes Jamal’s recollection that concludes with his gangster brother waving a gun around and shouting, “The man with the Colt .45 says shut up!”

Okay, we get it.

The funny thing is that "Slumdog Millionaire" could easily be re-edited to be a fun movie. Show the questions being asked rapid fire at the beginning, then flashback to Jamal's lifestory for an hour, then re-ask the questions and let moviegoers play the game alongside Jamal, searching through their memories of the last hour for the answers. It would also make the movie extremely memorable, since the way you remember something is to exercise your mind putting it in context.

Like a great baseball player’s career, Meryl Streep’s three decades in the movies can be depicted in a few statistics: fourteen Oscar nominations, four children, one husband, zero rehabs. Her new role as Sister Aloysius, the fearsome Mother Superior of a 1964 parochial school in the film version of John Patrick Shanley’s drama “Doubt,” would seem like the perfect outlet for her theatricality.

After all, it’s a charismatic job. When I entered St. Francis de Sales in 1964, all the big kids in the second grade explained that I might not survive being sent to the principal, because before Sister Adrian entered the convent she had been a lady professional wrestler.

Unfortunately, Streep’s performance never quite harmonizes with Shanley’s somber adaptation of his Pulitzer Prize-winning drama about the knuckle-rapping principal’s quick conjecture that a genial progressive priest is molesting a 14-year old altar boy. Streep’s hamming up Sister Aloysius as the Wicked Witch of the Bronx sounds entertaining, but she runs out of invention, perhaps due to her deprived upbringing as an affluent Presbyterian.

As a film, “Doubt” is a tidy he said-she said play (imagine Sleuth with four characters instead of two) by the Oscar-winning screenwriter of 1987’s “Moonstruck.”

Philip Seymour Hoffman (an Oscar-winner himself for “Capote”) plays Father Flynn, the newly arrived priest who is the state-of-the-art Vatican II cleric: progressive, genial, even cool. The priest is particularly solicitous of the feelings of the grade school’s first black student, a lonely eighth-grade boy.

Hoffman radiates so much acting technique that he’s a bit miscast as the guiltily cringing molester: you keep expecting the expert thespian to turn on his reality distortion field and bluff his way out of the jam his character’s in, but he never does.

Sister Aloysius is deeply suspicious of this trendy liberal, so she instructs a kindly novice teacher to be on the lookout for any funny stuff. Young Sister James is portrayed by Hollywood’s perpetual ingénue, Amy Adams of the Disney musical “Enchanted.” Once again, the casting seems a bit off. If the Mother Superior in “The Sound of Music” could recognize that Julie Andrews isn’t cut out to be a nun, surely the even girlier Amy Adams is a little doubtful?

Setting the play in 1964 allowed Shanley, who was born in the Bronx in 1950, to get the period details right (Sister Aloysius bans all ballpoint pens because pressing too hard ruins penmanship), but undermines the plausibility of a plot that should have been set 20 years later.

The institutional crisis brewing in the Catholic Church in 1964 was less homosexuality among priests than rampant heterosexuality: the Father Flynns and Sister Jameses were falling in love, leaving holy orders, and getting married. The admittedly anecdotal evidence suggests that declining numbers of straight priests allowed the gay element in the clergy to reach a critical mass, enabling what had been a chronic but limited problem to metastasize.

By naming his 2004 Pulitzer Prize-winning drama “Doubt,” Shanley pulled a fast one on the many critics who assume Sister Aloysius is the villainess as quickly as she assumes the worst about Father Flynn.

Programmed to praise doubt and denounce dogma, the pundits salivated on cue when Shanley launched a media campaign to spin his sturdy little play as an attack on religious fundamentalism. In the New York Times, for instance, Christopher Isherwood asserted that “Doubt” delivers “a broader commentary on the state of the cultural and political discourse in America, and indeed on the dangerous human tendency to take refuge in certainty…” Surely, though, the Church’s homosexual molestation scandal is a case of tolerance run amok, just as Father Flynn’s guilt is beyond doubt?

Shanley’s actual text has a much less hackneyed point to make via the movie’s best performance. Viola Davis plays the victim’s mother, who, to Sister Aloysius’s shock, explains that she is at least relieved that her son’s latest admirer is a kind gentleman. After all, she took him out of public school to keep him from getting beaten up by other boys so much.

Shanley himself is struck by the duality he’s witnessed in homosexual priests. A child in his extended family was molested, but a similar man “saw something in me, and educated me; gave me a great classical education. But he was a predator, and in my case he did nothing about it, but in other cases he did do something about it.”

As Dennis Dale noted even before the Inaugural Kitschfest, Milan Kundera pointed out that:

Kitsch causes two tears to flow in quick succession. The first tear says: How nice to see children running on the grass! The second tear says: How nice to be moved, together with all mankind, by children running on the grass! It is the second tear that makes kitsch kitsch.

The first tear is what we shed in the presence of a tragic, pitiful, or perhaps beautiful event. The second tear is shed in recognition of our own sensitive nature, our remarkable ability to feel such pity, to understand such pathos or beauty. A love of kitsch is therefore essentially self-congratulatory. In a withering critique of Sir Luk Fildes's The Doctor (1891, Tage Gallery), Clive Bell says that this famous portrayal of a thoughtful physician with a sick child creates what he calls a "false" emotion. What the painting gives us "is not pity and admiration but a sense of complacency in our own pitifulness and generosity."

The kitsch object openly declares itself to be "beautiful," "profound," "moving," or "important." But it does not bother trying to embody these qualities, because it is actually about its audience, or its owner. The ultimate reference point for kitsch is always me: my needs, my tastes, my deep feelings, my worthy interests, my admirable morality. ...

Kitsch shows you nothing genuinely new, changes nothing in your bright shining soul; to the contrary, it congratulates you for being exactly the refined person you already are.

January 21, 2009

Given the limitations of Oliver Stone’s biopic about George W. Bush (modest budget, rushed production, lack of memoirs by the officials who started the Iraq War, and Stone’s own fading powers), “W.” turns out better than expected. Anchored by another charismatic performance by Josh Brolin (the hunter turned hunted protagonist of “No Country for Old Men”), this tragicomedy of regression to the mean offers a plausible depiction of the President’s resentful yet admiring relationship with his imposing father, and the complicated ways that set the stage for the 2003 Iraq invasion.

Brolin has emerged recently as such an enjoyable leading man to watch that he makes spending 129 minutes with George W. Bush fun.

The historical accuracy of Stone’s films has been improving since their nadir with the infuriating but stylistically dazzling “JFK” in 1991. Unfortunately, as the older, wiser Stone has gotten more honest, his aesthetic bravura has dwindled. I only noticed two scenes that seemed distinctly dubious: Dick Cheney ranting about America acquiring a global empire of oil, and a 1988 passage in which Dubya talks his dad into running the Willie Horton ad. (The undying omnipresence of favorite liberal talking points like Willie Horton in our cultural memory points out that history isn’t actually written by the victors, it’s written by the writers of history.) The great majority of the screenplay, though, strikes me as on solid ground, historically and psychologically.

Visually, Stone seems to be trying to make “W.” look even more like a made-for-TV movie (maybe one of those Dallas reunion specials) than the limited budget mandated. The score is weak. Other than a creepy-acting Thandie Newton as Condoleezza Rice, the supporting actors don’t look like much like their real-life counterparts (Richard Dreyfuss as Dick Cheney?), but turn in competent performances.

And don’t expect a complete portrait of the origin of the War—there’s barely any mention of the neocons or of Bush’s unquestioning political correctness that made him assume Iraqis (!) were ready for democracy.

Still, “W.” is entertaining, informative, and likable. It has not been a success with the critics, who are annoyed that it doesn’t condemn conservatism as inherently evil. Indeed, Stone’s depiction of George H.W. Bush as an old-fashion prudent conservative is downright hagiographic. The 6’-7” James Cromwell, best known as the farmer in the talking pig classic “Babe,” brings more gravitas to the role of the 41st President than did the boyishly goofy elder Bush himself.

Stone was the natural choice to film the empathetic screenplay by Stanley Weisberg (who cowrote “Wall Street” with him two decades ago) because he has much in common with the President, such as substance abuse problems, a religious conversion, and declining popularity. The son of a Wall Street tycoon, Stone entered Yale the same year as Bush. Stone’s rebellion played out more flagrantly. While Bush followed his father’s path (Skull and Bones, military aviation, oil, and politics), just more drunkenly, Stone volunteered for combat duty in Vietnam (as shown in his “Platoon.”)

It’s unfortunate that Freud’s silly theories have discredited all psychological analyses based on nuclear family dynamics, because they can sometimes explain much about politicians. The ambitions of both Winston Churchill and Barack Obama, for example, were fired by political fathers who ignored their sons on the way up, before failing ignominiously.

George W. Bush’s Poppy Problem was the opposite of Obama’s: his father was an all around pretty good guy. As Stone commented, “Forty years is a long time to wait when your father is better at sports, politics, oil, money, diplomacy, and even academics than you are.” Nor did it help that his dad saw W.’s younger brother Jeb as his natural successor in the White House.

The relationship between father and son also had its good side. The father kept giving the prodigal son second chances, and W. finally repaid him, quitting drinking the day after his boozy 40th birthday party in 1986, in part to keep his behavior from distracting from his father’s White House run. He went on to be a surprisingly decent governor of Texas by concentrating on just four reforms. Then, the Peter Principle promoted him to his “level of incompetence,” the Presidency.

While the father was known as the In-Box President, the younger Bush wanted to be the opposite, the Pushbutton President, the decider who makes a few big, tough choices based on gut instinct, then lets the Pentagon sweep up without bothering him with tiresome details.

Here's my review in The American Conservative of last fall's remake of Clare Booth Luce's 1939 comedy classic with an all-female cast, "The Women."

Isn't it irritating when a know-it-all movie critic trashes a new release just because it's not as good as its classic source (whether that be an older film, book, play, TV show, or theme park ride). That's a tiresome routine because it's mathematically certain that most new movies will be comparatively worse than the material upon which they are based. The average new movie is, inevitably, average in quality, while the famous old works that Hollywood spends tens of millions adapting into new flicks were almost all above average.

On the other hand, the differences between the source and the new release offer useful clues to the filmmakers' point of view, and can illustrate the evolution of attitudes over the decades.

Therefore, my rule as a reviewer is to watch the new film first to see what my unbiased reaction is, then read the book or watch the old DVD.

The new version of "The Women" illustrates the value of this approach. It had been a couple of decades since I'd seen George Cukor's 1939 version of the satirical play by Clare Booth Luce (the future grande dame of the American Right) about Park Avenue ladies who lunch. So, I found the new film -- a chick flick buddy comedy about Mary (Meg Ryan) and Sylvia (Annette Bening), the squabbling best friends forever who eventually team up again to win Mary's husband back from the scheming perfume counter vixen Crystal (Eva Mendes) -- to be quite likable.

Compared to last summer's hit, "Sex and the City," "The Women" is shorter, less tawdry, somewhat funnier, and Meg Ryan is easier on the eyes than Sarah Jessica Parker. Some of the stars appear too Botoxed to manage understated facial expressions, but we don't live in an age of subtlety, so little is lost.

But then I watched the original from Hollywood's annus mirabilis of 1939, and it makes the 2008 effort seem like The Importance of Being Earnest as rewritten to serve as a very special episode of The Oprah Winfrey Show.

Norma Shearer, the stubby, cross-eyed Canadian whose indomitable determination made her Queen of MGM, brought her refinement and silent movie acting skills to the role of Mary, the betrayed upper class wife bravely trying to keep up the façade while crumbling inside. Shearer's real-life rival, Joan Crawford, who now seems too much the screen legend to be believable in most of her roles, was perfectly cast as the phony gold-digger Crystal. When playing herself -- an ambitious broad on the make trying to act the lovely lady -- she's awfully appealing.

And, in her first comic role, the great comedienne Rosalind Russell ("His Girl Friday" and "Auntie Mame") prefigured the I Love Lucy TV series by a decade with the slapstick willfulness of her Sylvia. In contrast to Annette Bening's sympathetic 2008 portrayal of Sylvia as a high-minded fashion magazine editor whose underlings want her to run sleazy cover stories on "How to Get Revenge," Russell's Sylvia was a spoiled stinker in Jungle Red nail polish who spreads poisonous gossip about Mary's marital troubles out of malicious glee.

The remake was intentionally declawed by its writer-director Diane English, creator of Candace Bergen's Murphy Brown television show, out of feminist loyalty to the team. English complained, "… the movie had very old-fashioned ideas that were in great need of updating … The original play and film were written as a poison pen letter to shallow society women who would stab each other in the back over a man … I had to figure out a way to shift the focus. I wanted to celebrate women …"

Self-esteem boosting female empowerment plot developments ahoy! (Aren't there any bitchy gay men left in Hollywood who could have done for the remake what Cukor did in 1939?)

Another question the new version raises is whether a classic comedy of manners can be adapted to an era that disdains manners as pretentious and undemocratic? The upper class just isn't as entertaining as it used to be. After the 1960s social revolution, the rich kept most of their privileges (such as being rich), but shed their traditional responsibility of edifying the masses with their starchy manners and dress. The current cult of authenticity allows the upper crust to live more casual, comfortable lives -- no more dressing for dinner! -- but, as the new "Women" demonstrates, less amusing ones, too.

Last fall, a commenter here cited links to two academic journal articles showing higher mortgage default rates for blacks and Hispanics in the 1990s. Unfortunately, I didn't call attention to them at the time and now I can't find them. If you could repost them, I'd appreciate it.

I'm not in the mood to defend George W. Bush, but I suspect that historians will eventually figure out that his big domestic / economic policy mistakes (e.g., allowing so much illegal immigration and promoting zero down payment mortgages to increase minority home ownership) stemmed from him assuming that the rest of the country was like Texas.

Bush had been a decent governor of Texas for six years. And Texas has continued to do relatively well in the eight years since he left Austin (e.g., there was hardly any Housing Bubble in Texas).

Bush knew Texas well, but he didn't know the other 49 states, especially not California. Approaches that worked okay in Texas proved disastrous elsewhere.

A variety of evidence has long pointed toward minorities accounting for a disproportionate fraction of the defaulted subprime mortgage losses that set off the economic crash. This would hardly be surprising since the government pushed hard to increase lending to minorities of marginal creditworthiness in the name of increasing minority homeownership.

The Clinton Administration teamed up with leftist groups like Obama's colleagues at ACORN to push for more lending to minorities. The Bush Administration stepped up the pace, denouncing down payments as barriers holding minorities back from the American Dream, in part to convert the growing Hispanic population into homeowning Republicans.

But, like the guns of Singapore in 1941, the government's statistics-collecting apparatus is designed only to make sure that minorities are getting enough loans, not to count how often they default on their mortgages. So, we've been lacking direct data on foreclosure rates in the current Housing Bubble.

Back in October, a reader calculated from the federal Home Mortgage Disclosure Act database that minorities got half the subprime cash (for home purchases and refinancings) handed out in the big years of 2004-2007. Mortgage dollars (prime and subprime) for home purchases leant to Hispanics went up 691% from 1999 to 2006 and 397% for blacks (but only 218% for Asians and about 100% for whites). In other words, mortgage lending to Hispanics almost octupled from 1999 to the peak of the Housing Bubble in 2006. Thus, a sizable majority of defaulted dollars lost are in just four heavily Hispanic states: California, Arizona, Nevada, and Florida (what Wall Street called the "Sand States").

But, what about foreclosure rates by race?

Two economists at the Federal Reserve Bank of Boston, Kristopher S. Gerardi and Paul S. Willen, have published an important paper, "Subprime Mortgages, Foreclosures, and Urban Neighborhoods," which provides a solid indication. For the state of Massachusetts, they laboriously matched up federal Home Mortgage Disclosure Act data (which includes ethnicity but not foreclosures) with county registrar office data, which can tell them if the property wound up in foreclosure but doesn't list ethnicity. By collating the two disparate databases, they wound up with foreclosure rates by race for Massachusetts.

Here's their abstract:

This paper analyzes the impact of the subprime crisis on urban neighborhoods in Massachusetts. The topic is explored using a dataset that matches race and income information from HMDA with property‐level, transaction data from Massachusetts registry of deeds offices. With these data, we show that much of the subprime lending in the state was concentrated in urban neighborhoods and that minority homeownerships created with subprime mortgages have proven exceptionally unstable in the face of rapid price declines. The evidence from Massachusetts suggests that subprime lending did not, as is commonly believed, lead to a substantial increase in homeownership by minorities, but instead generated turnover in properties owned by minority residents. Furthermore, we argue that the particularly dire foreclosure situation in urban neighborhoods actually makes it somewhat easier for policymakers to provide remedies.

They go on to write:

The first column in each panel of Table 3 shows the cumulative percentage of subprime ownerships that end in foreclosure. There are substantial differences between minority and white ownership vintages. For example, approximately 15 percent of black, subprime ownerships initiated in 2005 ended in foreclosure by December 2007, compared with 10 percent of Hispanic subprime ownerships, and 6.5percent of white subprime ownerships.

Here's data based on their Table 3:

Black

Hispanic

White

Black / White

Hisp / White

1998

8.5%

7.1%

4.1%

2.1

1.7

1999

9.2%

5.1%

2.5%

3.7

2.0

2000

8.1%

8.1%

5.4%

1.5

1.5

2001

8.7%

8.3%

5.2%

1.7

1.6

2002

8.9%

6.2%

4.8%

1.9

1.3

2003

8.6%

6.6%

5.1%

1.7

1.3

2004

12.9%

10.4%

6.6%

2.0

1.6

2005

15.0%

10.3%

6.5%

2.3

1.6

2006

10.2%

6.8%

4.1%

2.5

1.7

Keep in mind that these are cumulative foreclosure percentages up into 2007, with the year representing their "vintage." Normally, you would expect cumulative foreclosure percentages to decline as you get closer to the present since, say, a 2005 vintage mortgage has had less time for bad things to happen to the borrower than a 1999 vintage mortgage. But we see instead a rising cumulative rate peaking in 2004-2005. (And the 2006 ones will probably end up about as bad, or even worse, as the two previous years once their teaser provisions reset after a couple of years.)

So, in Massachusetts, the Non-Asian Minority foreclosure rate on subprime mortgages was about twice the white rate. That didn't change too much over the years, but the proportion of mortgages that were subprime and the proportion of mortgage dollars going to minorities changed radically in the Bush years, contributing sizably to the disastrous mortgage meltdown that began in 2007 and triggered the more general crash of 2008.

If that two to one minority to white foreclosure ratio seen in Massachusetts holds true nationally, where minorities took out half the subprime dollars, then minorities would account for two-thirds of all defaulted subprime dollars.

However, Asians probably have a lower default rate. On the other hand, they largely stayed away from subprime mortgages, so it's not a big issue. So, it's likely that minorities accounted for at least 60% of the subprime dollars defaulted.

In reality, what was truly disastrous was not total defaulted dollars per se but unexpected defaulted dollars. The financial industry expected a certain level of defaults each year due to family tragedies and the like, but they stupidly did not expect a systemic disaster from the government's efforts (e.g., President Bush's 2002 call to add 5.5 million minority home owners by 2010 by zero down payments on home purchases and other dubious means) to push minorities into home ownership. Thus, in California, the epicenter of the Bubble, the percentage of first time home buyers putting zero money down went from under 7% under Clinton to 41% in 2006.

Granted, Massachusetts is not the most representative of states. Still, this data seems to roughly fit what we see elsewhere in terms of where the foreclosures happened. So, it now appears likely that a sizable majority of the unexpectedly defaulted subprime dollars were lost on properties owned by minorities.

Many people can't believe that minorities could account for so much of mortgage meltdown, but there are now over 100 million minorities in the U.S. Furthermore, their mortgages tended to be relatively larger than one might expect because they tend to live in fairly expensive urban areas rather than in dirt cheap rural areas. In the 2006 vintage, for example, the average Hispanic's mortgage was slightly larger than the average non-Hispanic white's, and the average black's was only about 15-20% less. (The high cost of Hispanics' mortgages is due in large measure to so many living in California, where median home prices were almost triple the other 49 states average at the peak of the Housing Bubble.)

This is not to say that minorities are "to blame" for the Mortgage Meltdown. The bipartisan consensus in favor of raising minority homeownership rates through laxer credit standards deserves much of the blame. As does the financial industry's refusal to ask politically incorrect questions about how many NAMs (Non-Asian Minorities) in California and elsewhere could possibly earn enough money to pay back the huge mortgages being handed out in 2003-2007, or could find Greater Fools willing to pay even more to live in slummy neighborhoods.

January 20, 2009

As a native of Mexico and a lifetime admirer of (and former editorial writer for) the New York Times, I confess that part of me wants to feel a measure of pride that the Sulzberger family has turned to a Mexican businessman for help. ...

But my Mexican pride doesn't survive a moment's reflection. If the Sulzbergers think they can take Slim's money without tarnishing the newspaper's brand, then America's media elite must really think that Mexico doesn't matter.

Basically, the American media finds Mexico to be various combinations of comic, boring, depressing, and horrifying. We read more, pro and con, about Israel, a country of six million an ocean away, than we do about the country of 110 million with which we share an 1852 mile border. In the last few years, the LA Times has started to run colorful, tabloidish (and I use that term as a compliment) articles on Mexican politicians and mass murderers in hopes of getting the Mexican population of LA to try reading a newspaper, but that's been an exception.

Let's face it. The New York Times would never strike a deal with a U.S. tycoon of a similar profile, for fear of triggering real or apparent conflicts between the newspaper's coverage and the investor's interests. Not that you could ever find such a U.S. tycoon: The conglomerate of Slim-controlled telecom, banking, tobacco, retailing, insurance, construction, and other interests has been estimated to add up to 7 percent of Mexico's GDP. Even in his heyday, John D. Rockefeller accounted for only about 2 percent of the U.S. economy. As Forbes put it in its 2007 ranking of billionaires, Bill Gates or Warren Buffett would have to be worth $784 billion to have a similar share of U.S. wealth as Mr. Slim has of Mexico's wealth.

I should say this is an unaccustomed position for me. As an editorial writer at the Times and as editorial-page editor at the Los Angeles Times, I often found myself defending Big Business against a roomful of reflexively anti-corporate journalists. And, further bolstering my credentials as a capitalist apologist, my father was an executive for a large Mexican bottling company. But this is a bridge too far.

First, the scale of Slim's fortune, and the extent to which it was built on a government-sanctioned monopoly, is scandalously unique. ...

Whether a weak Mexican state can develop and implement muscular antitrust policies to rein in the likes of Slim and foster greater competition is one of the keys to our neighbor's prosperity, which shouldn't be a minor story for an American newspaper. (And it could become a national security story. Stay tuned.) ...

The point is, Slim doesn't have to interfere at all. I know from experience that publishers do intervene in the editorial process, as is their prerogative. And I can assure you that Slim's investment will be a factor, even if unspoken, in editorial decision-making henceforth at the Times. Perhaps Mexico's crony capitalism will remain a mostly neglected topic—but now conspiracies will be read into the neglect. ...

Slim wins either way. When writers and editors do lob an occasional piece into the paper critical of Slim, and they will, he will then be able to brag about it back home, absolving himself of charges of being a thin-skinned bully. Indeed, the conspiracy theory will then become that he ordered the Times—which everyone in Latin America will assume he controls, regardless of the reality—to be critical of him.

Setting aside any specific content in the paper, the mere fact that the Times Co. has allowed itself to become so dependent on Slim's fortune provides him with a priceless seal of approval. It becomes easier for him to write off his critics in Mexico as perennially frustrated leftist whiners. If any of what they alleged were true, after all, would the enlightened and liberal New York Times allow him to become one of its largest shareholders? Slim is lending money to the Sulzbergers for the same reason he has donated to Bill Clinton's foundation.

Just for fun, here's a picture of Mexican native Andres Martinez, who looks less Mexican than Carlos Slim does, and Slim (whose father was named Salim) is 100% Arab (Lebanese Christian).

Natalie Angier of the New York Times writes, "In 'Geek Chic' and Obama, New Hope for Lifting Women in Science," which is the usual, but with one difference. Over the last four years, in practically all of these articles demanding more women get hired as professors of physics, former Harvard president Larry Summers would come in for some ritual denunciating.

But, now, there's no mention of Larry. Why not?

Because The One has chosen him. So, Larry's 2005 heresy has disappeared down the Memory Hole. Obama addicts can't handle cognitive dissonance, so Larry's cognitive dissidence shall never be spoken of again.

Redlining was a practice that banks once used: hang a map on the wall, draw a red line around minority neighborhoods, and deny all mortgage loans inside the line. The results were devastating--depressed prices because no one could get financing to buy homes and underinvestment in African American and Hispanic communities.

But those bad old days are gone. Now some lenders seem to draw a line around minority neighborhoods, then paint a big bulls-eye on them. That's where they target their worst mortgages. Massachusetts Attorney General Martha Coakley filed suit yesterday against Option One, the mortgage arm of H&R Block, alleging that they piled on costs for non-white families.

The specific examples are breath-taking: A black borrower with a 523 credit score paid $10,635 to refinance $167,000, while a white borrower with a 520 credit score paid $2,275 to refinance $200,000. Coakley said this was happening systematically across Massachusetts and elsewhere in the country. ...

Why isn't there an outcry against H&R Block? This is a well-known company with offices in minority and white communities across the country. Yes, they sold their housing unit this spring, but Coakley says this company followed procedures that systematically targeted minorities to pay far more than whites for the same loans. Coca-cola made national headlines years ago when some executives were caught on tape making racist comments. What about following policies that, if proven, show that this company stripped hard work black and Hispanic families of their money? Where are the boycotts and the cover stories in Newsweek and Time?

A commenter named Russ cut through the HLS professor's naievete and makes an important point:

Here we go again blaming the big bad lenders. I say these types of lawsuits are bunk. I am a black mortgage broker and the reason I say they are bunk is because I would bet a sizeable sum of money that the LOs [loan officers] banging those borrowers for $10k in fees are black too.

See, most successful LOs have a niche. And often that niche is race, ethnicity, religion, etc. That is how you earn business. Often times, when I see minority borrowers getting taken advantage of, it is by other minorities. They prey on the trust factor. The borrowers also don't make any effort to comparison shop. A five minute phone call will expose any broker/banker trying to take advantage of a borrower with excessive fees. Most brokers don't need to make $10k on a loan to be happy. However, without actually seeing the fee break down and specifics of the loan, it is hard to say if $10k in fees is excessive. On the surface it is, but there are times when it is justified particularly if that money is being used to buy out of a prepay penalty, discount points, etc.

Anyone with a 532 FICO score should be happy a bank is even willing to give them a loan, even if it cost $10k. A 532 FICO means you don't pay anything on time... EVER. I wouldn't loan a person with a 532 FICO a stick of gum. I have seen people 6 mos out of bankruptcy with scores higher than a 532. That FICO score is frame on the wall material. It also means one of the other bureaus scores were lower since lenders use the middle score!

It is hard to say these actions are systematic. I have NEVER seen a bank have different pricing for people based on race. The ONLY things that matter are credit, income, assets, property, and loan to value. Any pricing variation is ALWAYS done at the loan officer level since the LO is the one who ultimately controls price (rate and fees). That variation is based on how much work is needed to actually get the file closed. Subprime loans often take a ton of work - massaging credit scores, credit repair, etc....

Like I said, the only discrimination is at the individual LO level. Some LOs may charge more to unsavy borrowers regardless of race. If the borrower isn't shopping the LO and the LO feels they can get away with it, the borrower gets charged more regardless of race.

We know from the Ian Ayres study that Malcolm Gladwell and I notoriously disagreed upon that car dealers expect to extract more profit out of blacks than out of whites, so it would hardly be surprising if loan officer pile more fees on blacks on average. But, an awful lot of the loan officers doing the exploiting will be the same ethnicity. This is especially true for Spanish-speaking borrowers. Of course, borrowers with 532 FICO scores are exploiting lenders, as well. Everybody involved is exploiting savers and taxpayers, which, by now, you could say is pretty much the national pasttime.

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